Many years ago there was a VT-100 terminal program called VT-10-Squared for the Atari 8 bit computers that managed to produce legible characters that were only 3 pixels wide.
IIRC, it had both upper and lower case, as well as the special VT-100 graphics characters. It was definitely usable, if somewhat headache-inducing when used to consume many screens of text.
It worked by drawing the characters in "high resolution" graphics mode (320x192! Woohoo!) so you could use mainframe software on the Atari, which normally only supported 40 columns of text.
Looks like the software is still hanging around the various Atari archives... it might be worth extracting the font, if licensing permits.